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A study of this volume chart will prove very interesting and valuable. You can see that in June, July and August, 1921, the volume of sales was down to around 10,000,000 to 15,0000,000 shares per month. In March 1928, sales reached 80,000,000 per month for the first time in history. From this time on the volume of sales was very large, with this group of stocks working higher right along from the reaction in June 1928 when the price was 194 to the top in September 1929 when the price reached 381, there was never more than one month’s reaction and at no time did the average break 10 points under a previous month’s bottom. The volume of sales increased enormously in October, 1928, and continued large in November, December and in fact, right on up until August 1929, when sales were again over 100,000,000 shares, and the month of September sales were over 100,000,000 shares : see how the picture looks with this enormous volume at the top and then in October, the first time since May, 1929, the price broke under the level of the previous month, showing that the trend had turned down. All records for volume of sales was broken in the month of October, when sales reached 141,000,000. In the final reaction in November, or the last wave of liquidation, sales dropped down to around 80,000,000. Then the price worked up every month, making higher bottom and higher tops with a fairly large volume, until March, 1930, when the volume of sales reached 90,000,000. In April, the total volume of sales reached 111,000,000 shares, a very small gain in price. In the early part of May the price broke under the bottom of the month of April, which was the first time since the low was reached in November, and a sharp decline followed. The volume of sales for the month of May was heavy, reaching 80,000,000; then continued in June on fairly heavy volume, with the price getting down to 250 on June 9th. This movement on volume from November, 1929 to April, 1930, shows a rally in a bear market.

Note the bottom from January, 1929 to May, 1929, and that the rally in April just brought prices up under this heavy volume of sales where distribution took place in 1929. Note that the scale on this chart is 2 points to each 1/8 of an inch instead of 1, for in considering the angles from the low in August, 1921 and the low in November, 1923, the angles are doubled in value, that is, the angle of 2 x 1 equals the angle of 45° and the angle of 4 x 1 equals the angle of 2 x 1 or 22 ½°. For example, the angle of 2 x 1 from the low in June, 1928 equals the angle of 45°. Note that the price rested on this angle in May, 1929, and that it was broken for the first time in October, 1929 and the big decline followed. Note that the angle of 4 x 1 from August, 1921, which is the equal of the angle of 22 ½°, or 2 x 1, fairly in April, 1930, come right up under this angle. Then consider the next angle of 4 x 1 from November, 1923, which is also equal to the angle of 22 ¼ , notice prices in March and April got slightly above this angle, but that when the price opened in May, 1930, it dropped under this angle and then broke the angle of 45° from November, 1929 and the angle of 45° is really the angle of 2 x 1, or 22 ½°, counting the basis of the chart being at the rate of 2 spaces for one. Then the angle of 2 x 1, from November, 1929 is equal to the angle of 45°. This angle crosses at 248 in June 1930, the same place where the angle of 2 x 1, or 45 as it is drawn across there, crosses, making 248 a very important point. Also note that the low in January, 1930, was 246. If this angle is broken and this low of 246, of January, is broken, it will indicate very much lower prices for these averages.